Hi, who can tell me some about The Cashback Market?
There are almost no studies on the dynamic and continuously rapidly expanding global cashback market. Also, most cashback companies do not publish financial figures. Conservative estimations assume that the global cashback market is worth well over $84 billion.
The interest in the cashback market can be seen in the media response:
• "Tokyo's Rakuten buys American cashback giant Ebates for over a billion dollars."
• "Groupon buys up snapsaves."
• "Murdoch Publishing Group seize Checkout 51."
These company takeovers are primarily strategic acquisitions regarding the fast-growing cashback market. The strategic impetus of the acquisitions and the high sums invested, give clear indications of the huge potential of the rapidly developing cashback industry.
Individual cashback companies already generate well over $1 billion in annual sales. For example, the UK-based cashback provider Quidco, with sales of $1.22 billion, has already significantly exceeded the billion mark by 2014.
Cashback Unicorns
Another indicator of how attractive the cashback market is at the moment is the existence of unicorns (companies with an enterprise value of over $1 billion.)
Increasing Momentum in the Global Cashback Markets
The cashback model is extremely popular and successful worldwide, as can be seen from the exemplary sales figures of the following cashback companies. Cashback markets are developing at an above-average pace, especially in India, China and Southeast Asia as well as in Latin America. With household incomes rising and the growing “technology-savvy” younger generation, these large markets offer enormous potential for cashback companies. In particular, companies that are quicker, better and more consistent in responding to customer needs with their offers and cashback technologies than other companies, will be among the winners in these dynamic markets.
The Weak Points of Existing Cashback Systems
Many companies have recognized the need and high demand for cashback, coupons and other saving opportunities when it comes to shopping, which lead to a large number of different cashback systems. Only a small number of companies, however, satisfy the great customer demand for saving opportunities with genuine user-oriented solutions. This opens up even greater potential for repay.me in the e-commerce market, as repay.me responds to customers’ needs much more consistently.
Overview of the weak points of existing coupon and cashback systems:
• Low cashback: The amount of cashback in existing cashback systems is usually limited by the margins of the retailers. The cashback usually presents only a relatively low (percentage) amount.
• Cashback is included in higher product prices: Consumers pay for the cashback themselves through a generally higher price level. Many people see through this game, so they prefer to forego cashback and shop at discount stores instead.
• Complex and time-consuming systems: The use of cashback is complicated and multi-staged: you must first log in on the cashback website, then click on links that lead you to partner shops, print coupons and then take photographs of receipts or similar actions. This effort is ultimately too high for many customers.
• Lack of transparency: The cashback account is often not updated in real time and is not designed to be customer-friendly.
• Months of waiting until withdrawal: The usual waiting period until earned cashback is available and ready to be paid out is six to eight weeks.
• High error susceptibility of existing cashback systems: Customer ratings of existing cashback systems reveal that the connecting links between cashback websites and participating web shops are often invalid. This is partially because 90 percent of revenues on partner websites are not recorded for cashback. Manual follow-up transactions have to be requested individually at customer support which is usually overstrained. This means that customers have to carefully watch their cashback bonuses if they do not want to run the risk of not getting cashback for many of their purchases.